Study of Hero Honda Value Proposition

=Hero Honda : Challenges in Multi-segment Positioning and Selling Context of Brand Positioning. Hero Honda mainly focused on sub segmentation of each level of the market and targeted each segment with a message that was based on emotional benefits (indicative catchline Desh ki dhadkan), since emotional segmentation is more powerful than functionality based segmentation. Further it worked on: * Multi segmentation based on pricing, utility, income level and age profile * Brand portfolio covered 13 different products in motorcycle segment. * Hero Honda has also diversified into scooters tailor made for females. Increase in the market share of Bajaj and possible pull out by Honda group. * Bajaj capitalized on the affordable mobility to the mass middle class. Positioning approach of Hero HondaHero Honda positioned its products as per context above which can be evaluated as below: Pros * It has maintained strong leadership in entry level and executive level segments. * The strong distribution network of 4000 facilities nationwide including 700 dealers penetrating the rural India also has helped in the brand positioning to the target segment for respective product. The timing based promotion to its target markets like the farmers helped in translating their happy mood to maximize the sales of their motor bikes on certain festive occasions. * Using the media having the maximum percolation rate to the masses of the country.

Eg: Doordarshan reaches out to millions of people in rural areas where the cable TV is still unavailable. * Encashed on the emotion based “desh ki dhadakan” segment of India and were successfully able to beat the superior local technology of BAJAJ. Cons No focused attention towards high end segments due to varied segmentation. * Due to their over reliance on emotion based positioning they have not been able to portray their technological superiority over its competitors. Impact of Exit of Honda from JVHonda brings with itself Work culture, technology and good quality. So the impact is going to be that of one which would be hard to cover up. Challenges envisaged in the due course are: * Need for technological innovation to retain market leadership. * The present partner may turn out to be a competitor 5 yrs down the line. Brand value might be diluted considering the exit of an international brand thus posing a bigger challenge. Recommended Changes in positioning strategy * Focus on the high end segment of the market has mostly remained with Bajaj hence could be looked into with an aim to capture the market segment. * Improved and new ergonomics. (The gear positioning in Honda bikes – Since the gear shift pattern of the bike has 1 down and 4 up design, it hurts the feet when the rider is wearing chappals, which is more common in rural areas. )